For me there are two major factors, one being market-related, and the other usability.
A PDF is generally somewhat less secure than an eBook, although when you get into hacking either one it's hard to say why a PDF couldn't readily be made far more secure than a zipped micro-website (which is what most eBooks are). But in the end, eBooks are usually connected to a DRM licensing service, while (apart from Adobe's defunct (?) Digital Editions project) PDFs are pretty much up to each publisher to license, protect, and distribute.
As for usability, the reflow capability is much more important than it may seem at first glance. Although I much prefer the appearance of a well-designed PDF, since it essentially is a perfect recreation of anything you might want to design, reading the same PDF on a computer, tablet, phablet, and phone is very impractical. PDF reflow is sometimes completely useless, and without reflow the computer version is microscopic on the phone. So without reflow you really don't get a cross-platform publication.
There is a lot to be said for multi-platform design, and Adobe is trying hard to make that a practical solution. But there's still a huge amount of extra work involved in producing a “designed” presentation that can generate versions for every form-factor.
Beyond that, even with a given reader (say, my 4.8″ Galaxy S3), sometimes I'm reading with powerful glasses on, and I like to get about 70 chars per line, with fairly tight line spacing. At other times, I'm reading without any glasses at all, which means from a couple of feet away, so I'll set the document to a huge font that would be idiotic in another context. At the lectern, for example, it's great to be able to display what looks like 24-point type in landscape mode and use the phone as a teleprompter.
So eBooks provide distribution through DRM licensing services and (presumably) solid copy protection, and eBook reflow makes text suitable for reading almost anywhere, if you're willing to sacrifice most of the design.
I think it's worth differentiating another digital publication type, however, which I prefer to call eMags. These are the digital publications we're seeing more and more for major magazines. They require lots of close attention in the design and production stages, but they handle the various devices creatively, and preserve a fairly high degree of design refinement. They reflow, but in a much more intelligent way than a typical eBook (e.g., with dynamic columns as in ID CS6), yet they provide almost as much design control as a PDF. An important distinction between eMag and eBook is that the eMag preserves the notion of pages, or at least can do so, while the eBook can only “store” the original page number while essentially tossing the whole idea of pages out the window.
Allen
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